Strengthening Competition Laws: Morocco Introduces New Economic Concentration Notification Regulations
Africa Focus
Law Update: Issue 360 - Africa and Transport & Logistics
Nesrine RoudanePartner, Head of Office - Morocco
In a significant stride towards promoting fair competition and ensuring a level playing field for businesses, Morocco has recently enacted two decrees, namely 2.23.273 and 2.23.274, published in the Official Gazette No. 7197 bis on 23 May 2023.
These decrees bring about substantial changes to the existing regulations governing economic concentration operations, which are crucial to maintain a robust and competitive market environment.
By revising turnover thresholds and introducing new provisions for notification and fee requirements, the Moroccan authorities aim to streamline the process and ensure a comprehensive evaluation of concentration operations.
In this article, we delve deeper into the key aspects of the new regulations and their potential impact on businesses in Morocco.
One of the core aspects of the decrees is the modification of turnover thresholds, which serve as the cornerstone for determining the necessity of notifying the Council of Competition.
With the aim of capturing a broader range of economic concentration operations, the decrees now establish three distinct conditions that must be met for notification.
Firstly, when the combined total global turnover, excluding taxes, of all companies or groups involved in the concentration exceeds 1.2 billion dirhams, and at least one of the companies or groups individually realizes a turnover in Morocco greater than 50 million dirhams, notification to the Council becomes mandatory.
Secondly, if the combined total turnover, excluding taxes, of all companies or groups involved in the concentration, in Morocco, exceeds 400 million dirhams, and at least two of the companies or groups individually generate a turnover in Morocco greater than 50 million dirhams, the Council’s notification is required.
Lastly, if the entities involved in the concentration have collectively accounted for more than 40% of sales, purchases, or other transactions in a specific national market of goods, products, or services, or a substantial part thereof during the previous calendar year, the parties are obligated to notify the Council.
Alongside the modification of turnover thresholds, the decrees also address the procedural aspects of notification to ensure efficiency and transparency in the process. The decrees now specify the required steps and documents for submitting a notification to the Council of Competition.
Businesses intending to undergo an economic concentration operation are now required to provide a complete dossier of relevant information to the Council. The dossier must include detailed financial and commercial data of all parties involved, the nature and scope of the transaction, and any potential impact on competition in the relevant market.
The aim of streamlining the notification process is to enable the Council to assess economic concentration operations more effectively, identify potential anti-competitive effects, and take appropriate measures to safeguard fair competition.
In addition to revising the turnover thresholds and streamlining the notification process, the decrees introduce a revised fee structure for submitting a notification to the Council of Competition.
The fee is now set at one per thousand (1‰) of the transaction amount. However, the fee cannot be less than 20,000 dirhams or exceed 150,000 dirhams. For cases where the transaction amount is not declared by the parties, the maximum fee applies to the notifying entities.
Furthermore, businesses seeking an expedited decision within a timeframe shorter than the legal deadline will be required to pay an additional amount equivalent to two per thousand (2‰) of the transaction amount. This fee cannot be less than 40,000 dirhams or exceed 300,000 dirhams. In cases involving the creation of a new company, the expedited decision fee is set at 40,000 dirhams.
The introduction of the two decrees signifies Morocco’s commitment to enhancing its competition laws and ensuring fair business practices in the market.
By revising turnover thresholds, streamlining notification procedures, and establishing a revised fee structure, the authorities aim to facilitate a more efficient and transparent process for evaluating economic concentration operations.
Businesses operating in Morocco must familiarize themselves with the new regulations and comply with the notification requirements to avoid any potential penalties or delays in their transactions. Ultimately, these measures are expected to strengthen competition and foster a dynamic and thriving business environment in the country.
For further information,please contact Nesrine Roudane.
Published in August 2023
